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Damien Bosco
Damien Bosco, Attorney
Category: Business Law
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An individual who is an independent sales rep has a student

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An individual who is an independent sales rep has a student loan issue.

We recently received a letter from the state saying that his pay has to be withheld (15%) and sent to the state for wage garnishment. Atlanta (U.S dpt of Education Student Financial Assistance Collections)


1) He is not an employee. He is an independent contractor. Does that affect anything?
2) The form the state asks to be filled in states "who his employer is" on Employer Certification (ED-329D) . We don't want to have issues with employment taxes and so on as we have an independent contractor agreement, he works from home and sets his hours and is paid based on his invoiced time and a bonus (main compensation) on results. What should we fill out?
3) I assume all $ going to him whether for billed hours or bonus is docked the 15%?

Thank you.
Hi and Welcome! My name is XXXXX XXXXX will be assisting you. I am happy to help you. Since the individual is not an employee and the company is not an employer, then the garnishment notice is inapplicable. In other words, the company cannot claim to be state c"who his employer is" since the company is not an employer. Note that an independent contractor's income from a company through a 1099 are accounts receivables. A creditor with an judgment can levy an independent contractor's accounts receivable, but not garnish the accounting receivables.. This means that when an independent contractor receives a check from a company for work, the bank account can be levied. I hope this helps you. Regards, Damien
Customer: replied 3 years ago.

Can you back up what you are stating with some links from the governmental website?


I was told by one lawyer that if we don't pay then we would be liable for the full amount. What you're telling me is completely different.


Want to see the law site links to make sure what is done is right.



Hi Eric: My answer is general in nature and is not legal advice. So, if you received legal advice from a local attorney, then I would recommend following the attorney's legal advice. In any event, here are links to the Georgia Code discussing garnishments: im-amount-and-defendants-social-security-number-on-summons-information-to-be-contained-on-summons-of-garnishment-upon-financial-institution

I hope this helps you. Regards, Damien
Customer: replied 3 years ago.

Does it make any difference that my company is a NV LLC?

Hi Eric: I think it can make a difference. I did further review and it appears Georgia is stricter than most jurisdiction, categorizing income from any source subject to garnishment. Case law would have to be looked at which is beyond this site. Moreover, the applicability of Georgia Law to an Nevada Corporation is unclear without further research. Would you like me to opt out to see if another expert can help you more? Regards, Damien
Customer: replied 3 years ago.

Thank you for checking.


The contractor made contact with the collection agency and set up a payment plan as of March 8th.


What should we do as the company now?




Eric: There are certain procedures you need to follow. Here is a link that explains it:

You may be able to contact the collection agency to verify that it has been settled.

I hope this helps you. Regards, Damien
Damien Bosco and 6 other Business Law Specialists are ready to help you
Hi Eric,

I just want to thank you for giving me a positive rating. I am here to help you in the future also. You can request me by name the next time and I will be notified. Also, you can bookmark my profile and ask me a question that way. Here is the link:

Either way, I am always happy to help.

Best Regards!

Damien Bosco

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